NAFTA's relevance to Arkansas

by
MACK McLARTY Special to the Democrat-Gazette
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January 14, 2018 at 1:58 a.m.
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In today's partisan national climate, it appears that trade is in danger of becoming another political football. According to polling done by Pew Research, during the 2016 campaign, when populist candidates on both the left and right sharply criticized trade agreements, support for such agreements plummeted nationwide.

In the years since, the trend has reversed itself, and a majority of Americans once again believe trade with other countries is good for the U.S. But there remains a strong partisan divide. This is especially true when it comes to the North American Free Trade Agreement, a favorite target of President Trump's.

Historically Republicans, not Democrats, have been considered the party of free trade. Yet today, 54 percent of Republican-leaning voters hold a negative view of NAFTA, while 72 percent of Democratic-leaning voters hold a positive one.

These views are especially relevant as NAFTA celebrates its 25th anniversary, and the United States must decide whether to update the agreement or abandon it completely. My experience has taught me that the politics of trade aren't easy. In 1993, I served as chief of staff to my fellow Arkansan, President Bill Clinton. In that role, I was one of the point people responsible for making sure NAFTA was ratified in Congress. I've seen how difficult it can be to bring together different parties, regions, and even countries around a set of principled compromises in pursuit of a shared goal.

Yet I have also seen that trade can be a bipartisan issue. NAFTA was negotiated by the first President Bush and signed by President Clinton. It passed with both Democratic and Republican votes. And countless Americans--not just across the country, but here in Arkansas specifically--are better off because it did. Updating the NAFTA agreement for a new century is absolutely necessary. But withdrawing from it for purely political considerations would be the wrong choice, one that would make families throughout our state worse off.

In the past 25 years, NAFTA has improved relationships with our neighbors to the north and south. By an enormous margin, America is Canada's largest trading partner. In addition to providing economic benefits, these close ties help us counter China's rising economic and geopolitical influence in the Pacific.

Meanwhile, in Mexico, NAFTA has led to the kind of development that benefits the United States. The gradual emergence of a Mexican middle class and the slow but steady strengthening of Mexican democracy makes a potentially volatile region more stable. Moreover, a stronger Mexican economy means less incentive for workers to cross the border illegally in search of jobs. And economic cooperation paves the way for cooperation in other areas, such as in combating drug cartels.

It also creates exciting new opportunities for the future, and to our state's credit, Arkansans are taking full advantage. In 2014, Arkansas State broke ground on a campus in Querétaro, a city in Mexico that has become a hotbed for high-tech companies from around the world. Soon, students and researchers from both countries will be able to collaborate, helping to bring a new generation of ideas and jobs back to Arkansas.

It's not just the potential for future jobs that makes NAFTA so valuable to our state. There are also economic benefits Arkansans are experiencing right now. In 1993, Arkansas was exporting $105 million worth of goods to Mexico each year. By 2015, that number grew to $837 million.

Behind those numbers are entire sectors of our economy, stronger today because of an agreement passed 25 years ago. A streamlined supply chain makes our manufacturers and small exporters more competitive. The ability for professionals to obtain work visas gives our larger corporations access to top talent. We don't always appreciate the everyday advantages of having strong relationships with our neighbors--an extra customer here, a reduction in price there--but we would miss them if they were gone.

Nowhere is this more true than when it comes to agriculture. In 2016, Arkansas exported $188 million worth of agricultural products to Canada, including $60 million of rice alone. Those exports supported 66,000 Arkansas jobs. Our only larger trading partner? Mexico. Combined, these two countries accounted for 44 percent of our state's total ag exports. That's an enormous amount of business.

And it is why abandoning NAFTA altogether would represent an enormous risk. The truth, for better or for worse, is that both Mexico and Canada have more options than they did in 1993. If we walk away from NAFTA, the alternative might not be a stronger bilateral agreement between the United States and Canada. It might very well be an agreement between Canada and China. In the absence of something better, withdrawing from NAFTA is not putting America first. It's inviting the rest of the world to catch up to America, and to leave our workers behind.

This is not to say NAFTA is perfect. On the contrary, the agreement must be updated for our current economic climate. When we were negotiating NAFTA's passage, for example, we never discussed how to treat e-commerce, because e-commerce didn't exist. Negotiators from all three countries ought to modernize the agreement, advocating for their own interests while understanding that everybody wins if all sides can get to yes. And in a world changing faster than ever, we must couple our commitment to free trade with a commitment to apprenticeships, vocational education, and on-the-job training, to ensure that American workers can always compete.

But when the politics are put aside, the facts demonstrate that NAFTA has been a success. If we once again approach trade with a spirit of bipartisanship, as Americans first, we can ensure NAFTA continues to benefit our state and our country for the next 25 years and beyond.

Mack McLarty served as White House Chief of Staff for President Bill Clinton.